India Proposes New E-Commerce Rules To Store Data Locally

Months after India came up with new rules on FDI in e-commerce, India has now proposed new standards in the e-commerce sector with a focus on local data centers in the country and enhanced privacy measures.

The proposed rules hint at data centers and server farms in India to ensure that users’ data stay in the country.

“In the future, economic activity is likely to follow data. It is hence vital that we retain control of data to ensure job creation within India, “ as stated in the draft policy document.

The rules, which are expected to become the final draft, will affect e-commerce sites such as Flipkart and Amazon, which are reviewing the rules and will soon share their respective suggestions.

The proposed rules aim to encourage the “Make In India” initiative and empower Indian entrepreneurs.

The draft states, “Steps will be taken to develop the capacity for data storage in India and three years would be given to allow the industry to adjust to the data storage requirement.”

The Government has asked for comments on the same until March 9, following which concrete rules will be made.

To recall, in 2018, companies such as MasterCard, Amex and Visa were asked to store Indian users’ data on local servers.

However, it is too early to comment on the feasibility of the rules if finalized.